Hospitality business rates changes welcome, but must go further, say Humber hoteliers

Healing Manor Hotel - 'any help is welcome, but it doesn't touch the sides'.

NEW Prime Minister Andy Burnham today announced a 20% cut in business rates for pubs, social clubs and live music venues, but the news has received a mixed response from local hoteliers.

The latest in a trio of announcements since he took over from Keir Starmer on Monday (July 20), was the toast of some venues, while others felt left out, or urging him to go further.

Commenting on behalf of the British Chambers of Commerce, Kate Shoesmith, Director of Policy and Insight, said: “While news of a carve out for pubs, clubs and music venues is welcome, there are many other smaller hospitality companies facing an existential threat. Meanwhile at the other end of the scale, airports and hotel chains are already paying millions more. 

“The last few years of Brexit, Covid, rising energy bills, wars and other geopolitical crises have pushed costs to record highs and these show no signs of waning. 

“Our latest research shows more than a third of firms believe business rates are of more concern now than they were three months ago.

“And this anxiety is felt more sharply in some sectors, with more than half of hospitality business, and two fifths of manufacturers and transport firms fearing the worst.

“Any action on rates is long overdue and very welcome, but root and branch reform of the system was a Labour manifesto commitment, and it is time to deliver on that promise.

“A step-by-step action plan is required. First, the government must mitigate the steep jumps in bills across all sectors caused by the 2026 revaluation. That means introducing a single flat rate multiplier and making bills easier to understand.  

“This shift should then jumpstart a more rigorous consultation with business on how to fully reform what is a complex and rigid system. 

“The time for tinkering round the edges has long gone. What firms of all shapes and sizes need to see is a new plan for fair and proportionate business rates set out at the Autumn Budget. We stand ready and willing to help inform those plans.”

The Chair of the Chamber’s North East Lincolnshire Area Council and manager of St James' hotel, Paul George, said: It’s a long time until April next year. We will see lot of businesses go down.

“Hopefully, it’s for all leisure facility’s which have accommodation and bars under their premises umbrella”.

The owner of Healing Manor, hotelier Charlotte Bennett said: “Any reduction in business rates is welcome, and it's encouraging to see movement in the right direction. However, for most hospitality businesses, a saving of around £1,100 barely scratches the surface of the financial pressures we're facing.

“Over recent months I've presented MPs with a paper outlining more than 60 separate taxes, levies and compliance burdens affecting businesses like mine, and the overwhelming reaction has been one of shock. That tells me there is still a real lack of understanding of how our industry operates and the cumulative impact government policy is having on it.

“Hospitality doesn't need meaningful support in nine months' time. It needs it now. This isn't about asking for special treatment, it's about creating a fair and balanced playing field for one of the UK's largest employers and one of its most important social assets.

“Investing in hospitality isn't doing our industry a favour, it's investing in people, communities and the future of our high streets."

David Cooke, manager of the Mercure Hull Grange Park Hotel at Willerby, said: “It is clear the Government’s announcement has not been thought through and created just to grab headlines by tinkering rather than making a sensible change to support a struggling industry already hit by the Government’s payroll increases and new employment regulations.  It is very unfair to give certain parts of an industry a 20% reduction in business rates but not others. 

“A change which would very much help the hospitality industry survive and prosper would be a reduction in VAT, France for example, has a standard VAT rate of 20% but reduced rates of 10% for hospitality.”